Oliver Gill is a City A.M. reporter, you can contact him on oliver.gill@cityam.com

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L&G boss Nigel Wilson wants the group to be a "global leader in pension de-risking"

Oliver Gill

Legal & General is ready to pounce on Prudential's £10bn annuity business, as the FTSE 100 insurer splashes the cash on pension back-books.

On Thursday, Prudential announced plans to merge its UK fund management and life insurance arms, forming M&G Prudential. The announcement came as part of yet another quarter of double-digit growth in Prudential's Asian operations.

The move prompted analysts to predict the UK merger was a precursor for group separation that would leave more mature operations behind.

L&G has made no secret that it is on the hunt for snapping up similar opportunities to its monster £3bn purchase of Aegon's annuity business last year.

And according to reports by the Sunday Times, it has already internally earmarked the funds required when Prudential's annuity business is officially put on the market.

A spokesperson for L&G said: "We made it clear in our results announcement that we are interested in buying further annuity back-books like Aegon. However, there is no sale process at this time, so this is just an idea."